Financial Audit

Financial audit is an opinion intended to provide reasonable assurance, but not absolute assurance, that the financial statements are presented fairly, in all material respects, and/or give a true and fair view in accordance with the financial reporting framework. The purpose of an audit is to provide an objective independent examination of the financial statements, which increases the value and credibility of the financial statements produced by management, thus increase user confidence in the financial statement, reduce investor risk and consequently reduce the cost of capital of the preparer of the financial statements.

Financial audits exists to add credibility to the implied assertion by an organization’s management that its financial statements fairly represent the organization’s position and performance to the firm’s stakeholders. The principal stakeholders of a company are typically its shareholders, but other parties such as tax authorities, banks, regulators, suppliers, customers and employees may also have an interest in knowing that the financial statements are presented fairly, in all material aspects. An audit is not designed to provide absolute assurance, being based on sampling and not the testing of all transactions and balances; rather it is designed to reduce the risk of a material financial statement misstatement whether caused by fraud or error. A misstatement is defined in ISA 450 as an error, omitted disclosure or inappropriate accounting policy. “Material” is an error or omission that would affect the users decision. Audits exist because they add value through easing the cost of information asymmetry and reducing information risk, not because they are required by law.

For collection and accumulation of audit evidence, certain methods and means generally adopted by auditors are:

 

Posting and casting checking

Testing the effectiveness of management controls to address misstatement

Physical examination and count

Confirmation, Inquiry, Observation, Inspection, Tracing

Year-end scrutiny, Re-computation, Bank reconciliation, Vouching

How Spectrum Auditing can help you?

An expert audit firm like Spectrum offers frills free options to choose your financial audit work. Spectrum has been helping organizations fulfil its major tasks by being a value addition to its client in its growth. Our expert guidance and recommendations along with best practices for an efficient management has been our core strength.

Spectrum Auditing& Accounts is one of the leading audit, accounting and service provider in UAE. Call us today for a free consultation on Treasury Management offer.

Tel: +971 4 269 9329

mail: info@spectrumaccounts.com

FTA Approved TAX Agency